A time capsule of the greatest financial mania in the history of mankind, told in real-time by regular folks and patriots. May future generations better understand the madness of crowds, and how power and money corrupt.

November 24, 2006

If this doesn't turn around soon, I'll be joining the realtors in the ramen noodle line.$1.93 now buys 1 British Pound, or 1.30 Euros. It takes about $8 to buy a pint at the pub FYI.For those of you in the US who could care less, you should start caring if 1) you buy any imported items and 2) you ever plan on traveling outside of the US.For those of you outside the US who could care less, you should start caring since 1) your economy will tank as exports to the US tank and 2) The US and China melt down at the same timeUgly. Just ugly. Thank god I'm sitting on a lot of gold to take away some of the sting...

I notice this more than most since I spend a couple of months a year out of US, but USA residents will notice when gas goes back to $3, and even the Chinese will have to raise prices at Walmart. The only upside - Brits may start buying Miami condos again at bargain prices. . .hey, even someone in Manchester on the dole could buy a USA condo with the pound soaring. . .I can see it now - EASYJET flies the masses to Florida, and Brits Abroad take over. . .

Thank you Germany. It is depressing to live here for those with savings, less than 10%, and watch it get a 50% hair cut as the Fed floods the economy with Fiat cash. It is refreshing to see that the predicted slowdown is global. I can only hope that my savings will gain some value in a recession.

"For those of you outside the US who could care less, you should start caring since 1) your economy will tank as exports to the US tank and 2) The US and China melt down at the same time"

USA is a big economy but for example the biggest trading partner of Germany is France and the second is USA (9 percent of exports). The same story across the EU. 10 percent of economy is usually US related. So Europe will not be so much affected than Asia.

Chinese and Japanese are complete idiots with their blind believe in American consumers and with their huge soon-to-be-toilet-paper dollar reserves. Dumb and dumber.

There have been several conversations here about hedging against a dollar decline. Hasn't anybody been paying attention ? Sigh.. reminds me of the Vogons and their posted notification of the demolition of Earth for a gillion parsecs and nobody took any notice.

I watched TOUT TV( SQUAWK BOX ) this morning, straight after WorldWide Exchange on CNBC. WWX was all over the story about the drop in the $. Squawk Box began and there were the bugs at the top of the screen detailing the significant $ drop, the drop in the European stock indices, the drop in the Nikkei 225, the $9 rise in gold etc etc.. But the actual stories were - Black Friday, Black Friday Black Friday. It took them 17 minutes to get round to discussing the drop in the $. Talk about parochial!

I think this drop IS significant.

As I'd watched the $ drop over the last two days, I was planning our next tranche of hedging. ( the trigger was the DX dropping below 84.5 ). I reckoned that in the past the sole prop for the dollar was that people run to it whenever global tension rises. This time, despite the assassination in Lebanon, despite the 200+ deaths of Shiites in Baghdad people were NOT going to run to the dollar for security. Looks like they did not.Other buzz in the news was that Bernanke is joining Paulson in the US mission to China.. The buzz is that they are threatening to "diversify" away from the $ and Bernanke MAY be reassuring them about interest rates - i.e. he'll be raising them,so please pretty please leave your money in dollars ! Now that's gonna play well at home isn't it.

Boy the Chinese must think this is some sort of bad dream..with a trillion dollars sitting in their holding tanks...that is a lot of toilet paper..and keith is correct i dont buy silver to make money, but hey if it goes up great if not ehh! whatever.

Going to be a lot of pain for my fellow americans..enjoy that Black Friday Plasma tv while you can...cause in a few months it will be just a black square in the living room if you can not afford your electric bill..or if you have a living room to put it in...stupid stupid people.

RE: missing the boat on Gold.As the "Gold Bugs" would put it:All the countries in the world use fiat currency. So, holding "money" in fiat currency is never really safe. Gold is the natural hedge against currency depreciation. And the best time to buy gold is always".

BUT:I've lived through the run up in Gold thru the 70s only to collapse from $800 down to hmm 350. by 1994.I lost money buying Gold around 350 inn 1994 only to see it drop down to 250 by 2000. But of course since then we'd have the run up.I believe Gold does get manipulated by the respective Federal Banks - they take it in turns to sell their gold - or lease it out so it acts like extra supply - so "buy and hold" is not for me - you have to trade it IMO. That said, reading the interpretations of the technicals ( and I don't believe in those either but I accept that others do so I do ), its said that Gold broke thru resistance at 629. After that the uptrend is clear to 685.

I'm not hassling unless Gold drops below 607 ( when I start getting out ) and goes above 685 ( when I start watching it really carefully ). Along the way, I'll watch it and add ( no sells in sight for me ) on the working assumption that it will rise with hesitations around 644, 672 and of course 685.. But what do I know..

Its all guesses really. EXCEPT, O yeah, 666 will be a major price point too { :-) }

Be careful out there - there are the usual hucksters shysters, liars and thieves out there just as there are for stocks, bonds etc.. Caveat Emptor

Yeah, I'm into the physical man. No paper for me, it defeats the purpose. If I want paper, I'll buy Google stocks. I also have some miner paper for high leverage growth but the bottom line is the physical stuff is there if TSHTF.

Please tell me what your gold is going to do for you in the US with Bush re-enacting the Treasury laws concerning the ownership of gold, silver, any precious metals, etc? If the shit hits the fan and the Fed wants to your gold will be worthless as it will be outlawed from being used as a trade/monetary instrument. Yes, it might fuel an underground market, but if the economy hits the fan then complete control follows and who would risk becoming an enemy of the state and disappearing?

Think I'm nuts? Then why oh why would Bush and admin repeal the Posse Commitatus laws and re-enact the Treasury gold/silver laws all within the past few months? Hmmmmm, what do they know that the average person does not?

This is a valid point - its highly likely to happen here. Its been done before in this country and others across the ages, right back to when nation states didn't exist I expect. By the same token, black markets / underground economies will come into existence as they always have all thru the ages. And the risk / reward of getting caught gets arbitraged away. So that's what will happen.

We'll just have to go underground with the Gold holdings well before such laws get enacted. Do we have time? Absolutely... Such laws don't get activated without a background incessant and increasing drumbeat of "national crisis", "do your duty", "patriotism" - which in turn are responses to ever increasing real pain, suffering, trouble and strife all around you - like strikes, long lines, breakdown of infrastructure, unemployment, modern day equivalents of soup kitchens, increasing homelessness ( Brits will remember the documentaries of the '60s ), rise of charity organizations, rise of populist nativist leaders a la Enoch Powell in England, products like sugar vanishing of shelves, shortage of metal coins..

The signs will be unmistakeable. You just have to act on them. And like all good negotiators, don't forget to leave something behind on the table - so that the govt enforcers do get the satisfaction of taking "something" off you.

I agree to a point. The problem is the laws are already there. You wake up tomorrow and a nuke has detonated over a major city - instant suspension of rights and these laws go online immediately, no hearings, no commisions, nothing as they already are approved and waiting in the wings.

Or, major stock market crash, and things get bad. Gov't steps in and secures cities in the name of national security, curfews, etc. Sets up food lines, etc. Or perhaps what happened during the great depression, peoples wealth, deposit boxes, and accounts were gone overnight. I don't think FDIC means anything, except a false perception.

You have also forgotten gov't snitches. Worked very well for Germany during WWII. Would YOU barter anything deemed illegal knowing that the person you are dealing with might be a gov't agent or snitch who gets paid in food or some form of money for diming you out? Knowing you have NO rights if caught? So fear takes over and your gold and or silver just sits and rots not doing you any good. Thus, you are effectively in the same boat as everyone else.

Or last but not least, the government undervalues gold so much that it is not worth anything in the eyes of most people. I can't eat gold, but I can trade food. A new monetary system would override everything, and gold/silver would no longer be linked to the perceived value we deal with today.

Oh one more thing. You mention the signs will be identifiable. I ask one question - Were the signs foreseeable in Germany during WWII by most people who lived there? If you do things slow enough and not all at once no one takes notice, except for the few - but usually they disappear early on in the game...

Watch their exports dry up. Hard to export stuff when labor is so expensive.

Funny, German exports are rocking.

That's right, Germany with strong unions, high wages and 6 weeks of vacation.

Why? Because they work hard at making high-quality high-technology stuff---the way the USA used to. And no it is NOT a shortage of educated workers---that is just propaganda to lubricate the argument for abandoning US industry. If the careers were there, you'd have more than enough educated and productive workers for any high tech industry, despite the Jerry Springeroid bozounderclass.

And in Germany the people do not let them just outsource or destroy productive industry. If they do oursource it is to Eastern Europe which shares a similar market and similar cultural values (and converging wages)---and not globally cheapest dictatorships.

keith said... gold protects me from what is happening to the US$. I'm not looking to make a flip or a quick buck, I simply put a % of my holdings into gold.

keith said (on Homepage)Thank god I'm sitting on a lot of gold to take away some of the sting...********************************************

Not looking to flip gold??? How many times have you told us you've been in and "out" of gold this year?? You've certainly come across as a Gold Flipper to many readers on this board.....Will you be out the next time it corrects 10%, or will you buy more?

This is all just a matter of belief then - Based on evidence from history I believe there will be signs that one should / must act on. Perhaps I wasn't clear about how one should respond. The response should also be progressive. So, I think there are enough signs that I have some gold as physical coins despite the spread and that such gold cannot be part of any trading. But its not so bad that I'll stop using the GLD ETF- the convenience and tight spreads override the risk. Do I have money in bank accounts in other countries.. Absolutely.. Lots of it, most of it ? nope. And so on and on..

What I'm gettting at is that as the signs increase so should the response to it. You won't catch it completely but you should be able to avoid major aggravation.

RE: govt undervaluing gold.. But that's the point of the black market. There's the official price for things and then there's the real aka black market price for them. And black markets thrive and survive even in the most oppressive environments. Learning the style (Psst, wanna buy some silk stockings ? ) will be a necessary skill. Buying some illegal stuff like hash ( I think they call it trees nowadays) might be a good practice run for this. But you must have bought stuff under the table, stuff that "fell off a lorry" surely ? Black markets are just an extension of this.

Of course when physical safety starts to become an issue, I'll be long gone out of the country ( I have 3 nationalities).

RE: Signs in pre-WWII Germany. Of course the signs were there... I'd recommend the movie Cabaret for a story exposition of those times. There's always the masterpiece "Rise and Fall of the Third Reich" hmmm forgotten who its by.

Who is going to take my gold? the police? Nat guard? The same people trying to feed their own families - the same people trying to protect their "stash" - they are gonna show up at my door and say "hand it over"...too funny.

The LA riots - and "let it burn" mentality will be the rule.

Any cop armed with a 223 or 40 cal is not going to man a road check point - just won't happen.

See people - there are too many of us around - 80 % gotz to go - and starvation, desease, and civil war will work just fine.

My gold will remain mine - and while I can't eat it - I can barter in the BM for food, meds, or ammo.

You know what is the fundamental problem of Americans? SHORT TERM THINKING! You are acting like bunch of locusts. Do I buy American End Products? Hell No! Where is your beamers and audis? You are shit. Period

Richard said... Who is going to take my gold? the police? Nat guard? The same people trying to feed their own families - the same people trying to protect their "stash" - they are gonna show up at my door and say "hand it over"...too funny.

The LA riots - and "let it burn" mentality will be the rule.

Any cop armed with a 223 or 40 cal is not going to man a road check point - just won't happen.

See people - there are too many of us around - 80 % gotz to go - and starvation, desease, and civil war will work just fine.

My gold will remain mine - and while I can't eat it - I can barter in the BM for food, meds, or ammo.

They don't have to. They just devalue it like they did in the 30's. Also, black market? The new laws bush has signed bring every form of law enforcement under federal jurisdiction.

Unfortunately, its just wishfull thinking. If another Great Depression happens it will be almost impossible to fart without the government knowing what you ate, and what it smelled like.

First comes a suspension of weapons. The die hards who hold out? Waco and Ruby Ridge ring a bell, except there will not be a public outcry - because they will not know. Then comes check points and "papers". Finally the camps to house the "complainers and enemies of the state".

Marx had it right when he said Capitalism leads to Socialism, which leads to Anarchy, which eventually leads to Tryanny and the cycle starts all over again. That is years away (hopefully) but if the crap hits the fan I do not believe you will be entirely "free" unless you live in the mountains away from society like Jeremiah Johnson. Gold, jewels, guns, etc. will not save you in the end. Although I am a big gun owner and supporter I realize that everything has its day.

Oh and the LA riots thing? I was there when the guard shot the shit out of some "gang banger" who decided to run a barricade.

Why do you think the government has enacted so many laws? Terrorism? Partially, but the core comes from within. Just the same when the barbarians were at the walls of rome and cesear decided the "people" were to blame for the problems.

On gold, I want to own gold, I want to hold gold, unfortunately I also belive in stop loss orders and once gold retraced 10% from the high I owned it at I got out. gold was too crazy for me earlier this year. My stomach can't handle $100 daily swings.

In this case though I'm in at 612, so have some breathing room now, think we'll see 700 before we see 600

For the gold buyers in this thread, which includes me, who congratulate themselves on their wisdom, caution and good fortune to have the moolah that they need to preserve in the first place, the following extract from a column by Sean Corrigan in http://www.mises.org/story/2183is sobering:......"In such a world, it is likely to be the case that people will, from time to time, seek to acquire holdings of a relatively scarce, high value-by-weight, easily fungible, liquid, storable, real asset as an alternative to their holdings of a much less scarce, eroding value paper asset, such as comprises today's money.

In such a world, gold may therefore command a higher price than it did in more innocent times when the side effects of our ongoing decline were less severe and when the prospect of our fall was much easier to ignore.

If you hold that this kind of dread and defensiveness explains at least part of the metal's rising price, it is hardly a cause for universal rejoicing. For, though it is understandable that gold's long-suffering believers now feel gloriously vindicated, we must temper our present glee with the thought that the rally being enjoyed may be no more than a waypoint on our road to a self-imposed and wholly unnecessary ruin."

The guy writes in a rather quaint almost 18th / 19th century style of English but he's good. And he explains gold as an asset class well.

You all are forgetting one minor detail. The USD is the world's reserve currency. That is reality and it isn't going to change in a month, a year, or perhaps even a decade.

If the pols want to strengthen the dollar or just avert a complete meltdown, all they have to do is engineer a military of financial crisis. Foreigners will flock to the USD as a safe haven. The dollar is going to fall against other major currencies, and that is by agreement between the various central banks. They want an orderly devaluation, not a rout. If anyone tries to make it a rout, then Plan B will be implemented.

anon has a belief in the competence of the pols, the Feds, their software projects, the surveillance techniques..

The evidence of Katrina, the military and civil planning and execution of the Iraq War, the idiocy and total incompetence of the Dept of Homeland Security, the lionising of Greenspan in Congress and the media suggests that the rot of incompetence, ignorance due to the decline in education standards, graft and cronyism has infected the bureaucratic apparatus and the body politic to such an extent and vast methods of evading their insane schemes will exist.

There's also the warning from Robbie Burns ( Scot poet and nationalist) warning about "the best laid schemes of mice and men ". But in any case, this particular lot in power "couldn't even organize a pissup in a brewery".

They might LIKE to organize a orderly devaluation of the dollar but.. I read of all those runs on the pound when the UK Pound was the dying world reserve currency and personally recall the same issues when it was dead as a reserve currency but not quite buried - They won't be able to manage the orderly devaluation in quite the manner they envisage. Thieves do fall out with each other.

Its a matter of belief I know - I'll take my chances betting on the incompetence and corruptibility of the current lot in power in the USofA.

"The secret of great wealth with no obvious source is some forgotten crime, forgotten because it was done neatly."—Balzac

The journalist's rule says: follow the money. This rule, however, is not really axiomatic but derivative, in that money, as even our vice president will tell you, is really a way of tracking energy. We'll follow the energy.

We learn as children that there is no free lunch, that you don't get something from nothing, that what goes up must come down, and so on. The scientific version of these verities is only slightly more complex. As James Prescott Joule discovered in the nineteenth century, there is only so much energy. You can change it from motion to heat, from heat to light, but there will never be more of it and there will never be less of it. The conservation of energy is not an option, it is a fact. This is the first law of thermodynamics.

Special as we humans are, we get no exemptions from the rules. All animals eat plants or eat animals that eat plants. This is the food chain, and pulling it is the unique ability of plants to turn sunlight into stored energy in the form of carbohydrates, the basic fuel of all animals. Solar-powered photosynthesis is the only way to make this fuel. There is no alternative to plant energy, just as there is no alternative to oxygen. The results of taking away our plant energy may not be as sudden as cutting off oxygen, but they are as sure.

The common assumption these days is that we muster our weapons to secure oil, not food. There's a little joke in this. Ever since we ran out of arable land, food is oil. Every single calorie we eat is backed by at least a calorie of oil, more like ten. In 1940 the average farm in the United States produced 2.3 calories of food energy for every calorie of fossil energy it used. By 1974 (the last year in which anyone looked closely at this issue), that ratio was 1:1. And this understates the problem, because at the same time that there is more oil in our food there is less oil in our oil. A couple of generations ago we spent a lot less energy drilling, pumping, and distributing than we do now. In the 1940s we got about 100 barrels of oil back for every barrel of oil we spent getting it. Today each barrel invested in the process returns only ten, a calculation that no doubt fails to include the fuel burned by the Hummers and Blackhawks we use to maintain access to the oil in Iraq.

Following the U.S. dollarSince leaving gold, there have been several attempts to peg the value of the pound to other currencies, initially the U.S. dollar.

Under continuing economic pressure, and despite months of denials that it would do so, on September 19, 1949, the government devalued the pound by 30%, from US$4.03 to US$2.80. The move prompted several other governments to devalue against the dollar too, including Australia, Denmark, Ireland, Egypt, India, Israel, New Zealand, Norway and South Africa.

In the mid-1960s the pound came under renewed pressure since the exchange rate against the dollar was considered too high. In the summer of 1966, with the value of the pound falling in the currency markets, exchange controls were tightened by the Wilson government. Among the measures, tourists were banned from taking more than £50 out of the country, until the restriction was lifted in 1970. The pound was eventually devalued by 14.3% to US$2.41 in November 1967.

With the break down of the Bretton Woods system — not least because mainly British currency dealers had created a substantial Eurodollar market which made the U.S. dollar's gold standard harder for its government to maintain — the pound was floated in the early 1970s and so subject to a market valuation. The Sterling Area effectively ended at this time when the majority of its members also chose to float freely against the pound and the dollar.

A further crisis followed in 1976, when it was apparently leaked that the International Monetary Fund (IMF) thought that the pound should be set at US$1.50, and as a result the pound fell to $1.57, and the government decided it had to borrow £2.3 billion from the IMF. In the early 1980s the pound moved above the $2 level as interest rates rose in response to the monetarist policy of targeting money supply and a high exchange rate was widely blamed for the deep recession of 1981. At its lowest, the pound stood at just US$1.05 in February 1985, before returning to US$1.77 during the 1990s. As of August, 2006 it had risen back to $1.91 and has risen and fallen with the Euro against the US dollar, standing as of October 13, 2006 at $1.85.

"In the US it now costs about $8 to get into a movie, $4 for a small drink and $4 for a small popcorn."

In London movie tickets are $22 each, a large popcorn and drink $20.

Dinner for two at a decent place with a bottle of wine is around $170

An 80gb ipod video is $450, whereas in the US it's $330

A pack of gillete fusion razors sets you back $40.

In other words, expats and US tourists are screwed!

Kieth how can you live there and be so dumb about the cost of the exchange? In the USA a man making $50,000 pays pays $7,5000 to the Feds, $3,500 to the State, $3,200 to FICA, $2,000 to his city, and $2,000 in sales tax. That leaves him with $31,800 to spend on popcorn an movie tickets.

Do you know what England takes outof your pay check? Do you know what the sales tax is?

The Queen is a ball-less bitch. Parlament is a bunch of fags. They do not have the courage to face the people they repersent. They are British cowards.

In England the employer takes the money and gives it to the Queen. They people do not know what they are being taxed. The Brit making $50,000 a year says he earns "$31,800" because he is inbred moron that believes what he is told and $31,800 is the salary he negotiated.

The truth is that the first 1.6 times "more" that your goods cost in England are to American goods, are in fact the same price as American goods. It's the bit above the 1.6 times more that is the real cost difference. But that is only if you believe England taxes it's people the way America taxes it's people. The truth is the reason the Queen and parlament are such ball-less cowards is because they rape "their" people every day.

“Quietly but with malice, OPEC cartel nations have been dumping the U.S. dollar over the past three years, according to the Bank for International Settlements (BIS).”“The move away from the dollar could prove catastrophic for U.S. economic interests and bring to an end to more than a half century of dollar supremacy around the globe.”Click Here“Since our "federal reserve notes" have no value unless all countries are forced to buy them at economic gunpoint, Iran is the leak in the dike. If the USA doesn't stick its finger in it, it will definitely grow. Once other nations see Iran getting away with selling her oil for real money, they will stop buying U.S. dollars and the USA will be flooded with inflation because of her idiocy in having Federal Reserve notes backed by nothing.”Click Here“Israel has proposed to the United States to strike Iran on several occasions this year, Saudi newspaper al-Watan reported Sunday morning. According to the report, the latest proposal was raised during the Knesset Defense and Foreign Affairs Committee’s visit to Washington several days ago, where Committee members apparently attempted to “market one agenda: Launching a war on Iran.”Click Here

RE:--------------------------------“Israel has proposed to the United States to strike Iran on several occasions this year, Saudi newspaper al-Watan reported Sunday morning. According to the report, the latest proposal was raised during the Knesset Defense and Foreign Affairs Committee’s visit to Washington several days ago, where Committee members apparently attempted to “market one agenda: Launching a war on Iran.”---------------------------

Shitttt, is that what Cheney is doing in Saudi Arabia this weekend, viz. coordinating with, informing them of the impending attack ?

I will have to watch the price of oil next week and see if it rises. That would be an indicator. Hang on, perhaps the dollar drop that already occured WAS the indicator ?

This type of fundamental analysis is soooooo difficult for short term moves, no wonder technical analysis gets such a following.

It is urgent that each of us understand what may be about to transpire:

(1) Israel's Air Force and Navy armed with missiles and munitions provided to them by the U.S.A., will attack and severely damage one of our U.S. carriers, killing many of our servicemen.

(2) The savage attack will be blamed on Iran and its Prime Minister Ahmadinejad.

(3) The U.S. will launch massive air counterstrikes and naval bombardments at Iran, targeting that nation's entire military-economic infrastructure.

(4) The U.S. and Israel will simultaneously execute a media propaganda blitz to persuade the U.S. populace and the world that Iran is an aggressor, that Ahmadinejad is another Hitler, and that the U.S. military actions were simply counter-retaliation for Iran's "Pearl Harbor-like" assault on a U.S.A. vessel.

(5) End Result: Many American servicemen slain and wounded, tens of thousands of Iranians dead, Iran's economy spoiled, and Israel on top, oil prices skyrocket once again.

Israeli Prime Minister Olmert is, at this moment, here in the U.S.A. on a 5-day visit, meeting with Bush White House officials, and with high-level Jewish Illuminati. Could it be that this Iran war scenario is at the top of their agenda?

Next time around, the Selective Service will be sending America’s young women off to war. The seed has been planted in the minds of Americans. A Democrat of course was chosen as cover to champion the bill with the deceptive selling point “It's a matter of fairness.” Our women are next...

Market timing is a fools errand. Everyone should know that.You cant time secutirites, or gold, or currencies. Hindsight is always20/20 and I have had to train myself not to beat myself up for missingbuying opportunties. The fact of the matter is that if the dollartanks, its game over for everyone, and manufacturing can rebound in theUS, which will make the dollar stronger again. When Japan was flyinghigh, we all thought the end was here, and then ten eyars later, TIME had a headline about how Japan was jealous of the American monster.Maybe the world is globalized enough to live with a sick US on the sidelines, but there will at least be a transition period and it wont be pretty.Without our stolen oil reserves in Irsq, maybe we're done with, but maybe it will spur the kind of changes that will make us stronge rin the long run. The other main thing to remember is that all non-dollar instruments have been cruising at speculative levels, and if there is a slowdown, everyone will run to cash, and while the British pound or Euro may look like a good hedge, sometime someone will decide that they dont look so great either. Its much ado about nothing. Save as much money as possible for the coming recession, if it arrives.

You sound like those people crying the end of America when Japan was at their peak in th early 80s. Where is Japan today vs America? They have one of the highest national debts and are in the top two for holding dollars. Smart?

Europe is feeling the heat of high costs and high housing, remember Ireland, Britain, France, Spain, Denmark have had home prices rise much higher than US prices. And China is making inroads into their markets making countries like Italy non-competitive.

Exports? Because Texas exports more goods to Arkansa doesn't mean much viewed from our internal markets just as Germany or France's exports to other EU countries, they are integrated. When you compare the EU population and economic output and consumption in realtion to the USA that is more of an accurate picture and they have major economic issues and unfunded liabilities as we do. If Europe had to pay more for their defense we'd look a little better.

What do you think they were saying when the dollar bought a Euro for 78 cents after having been introduced at $1.19? Currencies rise and fall, look at Canada. When I went to college up there in 1973/74 I paid $1.05 US to get $1 Cdn. Then it went dow to about .62 cents US for $1 Cdn.

Means nothing in the long run. Do you think the British pound is really worth twice the dollar when they are a small country with little industry and home prices that make ours look cheap?